Fla. homeowner with $97,000 salary denied state help, but says she will fight ruling

A Florida homeowner who was denied state foreclosure prevention help because of her $97,000 salary lost an appeal earlier this month to overturn that decision.

But Karen Servant, of Homosassa, said she plans to fight her rejection from Florida’s $1 billion Hardest Hit plan, saying the denial is a form of discrimination and that the program’s stated focus _ to prevent foreclosure _ doesn’t jibe with eligibility rules that require borrowers to be current on their mortgage payments.

“They stated my waiver was denied because the program was developed to help prevent foreclosure,” Servant, 57, said. “That makes no sense. How can anyone who is up-to-date with their mortgage be in jeopardy of foreclosure – rhetorical question.”

The governing board of the Florida Housing Finance Corp., which oversees the Hardest Hit program, denied Servant’s appeal during its June 13 meeting. The board said approving her application would “violate principles of fairness to those Floridians who qualify for the program, but would be denied assistance, if the funds were provided to petitioner, and no funds remain to assist an eligible borrower.”

Servant was one of the first people to apply in October for Florida’s new Hardest Hit Principal Reduction Plan, which gives borrowers up to $50,000 to pay down their debt. But the homeowner must meet several eligibility requirements, including they can’t make more than 140 percent of the area median income.

At $97,000, Servant makes 244 percent of the area median income.

Salaries above the maximum allowed have been the biggest reason for rejections from the principal reduction program, which first opened for applications in September. The program was initially capped at 25,000 applicants, but reopened in May when just 2,400 homeowners had been approved to receive loan-reduction money.

Through March, about 150 of 2,100 Palm Beach County homeowners had been approved for the program.

The top salary a single person in Palm Beach County can earn and still be eligible for the principal reduction plan is $64,120. For a family of four, it’s $91,420.

“Disqualifying me because of my income is a violation of the principles of fairness,” Servant said. “If it’s not meant to be, it’s not meant to be, but I don’t want to think I haven’t done everything I can.”

Sorry, but someone who makes $97,000/yr and can't pay their mortgage? There's much more to this story than we're getting. Is Ms. Servant suddenly a single income household or simply living beyond her means and it caught up to her?

My understanding is that this money is to encourage those who despite the crash of the economy and the significant increase in the cost of living did everything they could to continue making their mortgage payments (which means doing without a lot of other things) and continued to make their payments instead of just walking away like so many people did; people who could afford to make their payments but chose not to because they owed more money than their house was worth.

Ms Servant should try a short sale if she cannot continue to make her payments......